Between hiring a marketing agency, purchasing advertising, and holding events, marketing costs can stack up quicker than most small business owners anticipate. Without deep pockets, it will be hard to maintain a solid marketing campaign that will reach new customers and grow your business—but not impossible.
There are still ways to finance a marketing campaign and get the ball rolling. Knowing where to look and being creative is key when money is tight. Here are our top five tips on how to finance a marketing campaign when you’re a small business owner on a budget:
1. Use Your Own Savings
If you have savings available, using your own money is always the best option. Not only will it be interest-free, but you’ll also have full control over how the money is spent. That being said, dipping into your personal savings can be risky. If your marketing campaign is unsuccessful, you could end up in a tough financial position with no safety net.
Of course, this means you’ll have to watch your budget closely. For instance, if you’re looking to implement Search Engine Marketing (SEM) or Search Engine Optimization (SEO) in your marketing campaign, conversion will be key. You’ll need to make sure your website is set up for lead capture so you can get the most out of your SEM/SEO spend.
2. Get a Business Credit Card
Another option with much less risk is to get a business credit card. If you don’t have the cash to pay for your marketing expenses upfront, you can put them on a business credit card and pay off the balance over time.
Just make sure to do your research before signing up for a card. Some business credit cards have high-interest rates, which can make paying off your balance more difficult (and expensive) than it needs to be. You’ll also want to look for business credit cards that offer rewards like cash back or points, which you can use to offset the cost of your marketing campaign.
3. Apply for a Loan
Not all business owners are comfortable with the idea of taking on debt, but sometimes it’s necessary. If you have a good credit score, you may be able to qualify for a business loan with a relatively low-interest rate. This can give you the funds you need to finance your marketing campaign without putting too much strain on your cash flow.
This option typically offers lower interest rates than business credit cards, making it easier to pay off your debt. The downside is that it can take longer to get approved for a loan, so this isn’t an option if you need funding right away.
A small business loan is your best bet if you have a solid business plan and you’re confident you can generate enough revenue to repay the loan.
If a small business loan is not an option, look into personal loans. Just keep in mind that this option is more expensive than a business loan, so it should only be used as a last resort.
4. Establish a Business Line of Credit
Another financing option for small businesses is to establish a business line of credit with a bank or credit union. This works similarly to how lines of credit work for individuals; you’ll be approved for up to a certain amount and can draw on the funds as needed, making minimum payments each month until it’s paid off. This can be helpful if you need access to quick cash but don’t want to take out an entire loan all at once.
A great way to spread out the cost of a marketing campaign is to set up a business line of credit before you even start spending. This way, you can make small withdrawals as needed and avoid putting all of your eggs in one basket. Just be sure to only borrow what you need so you don’t end up with a high balance that’s difficult to repay.
5. Find Investors
Lastly, if you’re having trouble finding traditional financing, another option is to look for investors who are willing to put money into your small business in exchange for an ownership stake. This can give you the capital you need without going into debt; however, it does mean giving up some control over your company.
Too many business owners think of their companies as their children. But at the end of the day, your business is just a tool to help you achieve your goals. And if giving up some equity is what it takes to get your business off the ground, it may be worth considering.
Speak with an experienced business lawyer before moving forward with this type of arrangement; they’ll be able to help you negotiate a fair deal and protect your interests.
No matter which financing option you choose, be sure to put together a solid plan for how you’ll use the funds. This will help you get the most out of your marketing campaign and make it easier to track your progress. With a little planning and some financial discipline, you can make your marketing campaign a success, no matter your budget!